Cozy, Portland tech startup, sells for $68 million

Six-year-old Portland startup Cozy sold its business Thursday for $68 million to CoStar Group, a major provider of online commercial real estate services.

The rare tech company in North Portland, Cozy offers automated tools to help landlords manage their properties. Founded in San Francisco, the company opened a Portland office in 2013 and moved its headquarters here the following year.

It struggled in its early days getting landlords to sign up for its monthly subscription service, which screens prospective tenants and automates the collection of rent checks. So Cozy changed course and started giving some services away for free.

That immediately attracted more landlords, who then began paying for premium services including tenant screening reports, credit and debit card payments, rental insurance, rent estimates and expedited payment processing.

Cozy says it handles online payments for 120,000 tenants, $1.4 billion altogether in the last 12 months. It says 50,000 landlords use its system.

The buyer, CoStar, is a publicly traded company based in Washington, D.C., that operates like a Zillow for commercial real estate, providing property information and analytics.

CoStar owns the LoopNet commercial real estate marketplace, Apartments.com and other websites. CoStar has a market value of $13.4 billion; it reported $965 million in revenue last year, and profits of $123 million.

CoStar said it manages 200,000 commercial leases and wants to expand into multifamily properties with Thursday's deal.

"Cozy's technology makes the renting and payments process simple, secure, and intuitive," CoStar chief executive Andrew Florance said in a written statement. "When combined with Apartments.com, the 40 million prospective renters that visit our network each month will be able to effortlessly locate, apply, lease and pay for their new rental home completely online."

Cozy had raised $18 million in funding. It said CoStar will retain Cozy's 37 employees, all but one of whom works in Portland.

"Our vision is incredibly well aligned with CoStar, and by joining forces, it drastically accelerates our mission to provide peace of mind to landlords and renters everywhere," Cozy founder and chief executive Gino Zahnd said in an email.

This has been
an eventful year in the Silicon Forest
, with several notable deals at some of the region's biggest tech companies. Beaverton-based Exterro and Portland-based Jama Software sold to private equity companies for more than $100 million and $200 million, respectively.

Meanwhile, Puppet, Urban Airship, SheerID, Rigado, Bumped and Lytics all announced eight-figure investment rounds. And also Thursday, a Portland company called Radar announced an unspecified investment from Vista Equity Partners, the firm that owns Zapproved.

This article has been updated with additional information about the transaction and has corrected the description of Cozy's business model.